Tag: Accountant

Did you lose your original BIR form 2303 or the Certificate of Registration (COR)? That you already exerted effort but you can’t find it. Or your company’s BIR 2303 was caught by fire, flood or natural disaster? Well, don’t worry, you can always replace the BIR Form 2303 or the BIR Certificate of Registration (COR) by doing the following:

Get a copy of BIR form 1905 (Application for Registration Information Update) and fill out properly.

Prepare a notarized Affidavit (e.g. Affidavit of Loss, if lost). Much better if you have a photocopy of the BIR Form 2303. Much much way better if you have the old original certificate for replacement.

Then go to your Revenue District Office (RDO) where your business is registered and submit the accomplished BIR Form 1905 together with the required attachment/s. Please take note that the BIR is already implementing the queuing system. Thus, get a number and check window / table number for the submission of your application.

The BIR RDO personnel who is assigned for the receiving will advise you to pay the necessary certification fee and documentary stamp tax. This is the time to get and accomplish copy of BIR Form 0605 (Payment Form).

After which, you will be advised to pay the required amount to the any BIR accredited bank/s and the date when the new Certificate of Registration will be released.

Bring the proof of payment or submit before the issuance of the new Certificate of Registration. But for some RDO, the proof of payment is required prior to accepting the BIR 1905 and Affidavit. Either way, you should get a receiving copy of your application and the specific date of release of your new BIR Form 2303.

Almost always business owners, particularly those who are managing small businesses and those under SME category, disregards to see the importance of having accountants. Oftentimes, they look for an Accountant when it’s already too late or worst the BIR had issued a letter of notice (LN) or letter of authority (LOA) for their business.

As an Accountant, we understand that small business owners find it costly to maintain a retainer to do the monthly bookkeeping and tax preparation for their business. But what they don’t realize is the monetary and non-monetary benefits of maintaining one.

The following will explain the importance of accountant in your business, no matter how big or small it is.

1. Organized Record of Financial Data. Most business owners want to focus their time and energy operating and growing their business. As such, their financial documents for personal and business often mixed up. Having an unorganized financial documents create stress and headaches to business owners because they don’t know exactly what is happening in terms of financial standing. First, accountants maintain an organized record and filing of business day to day financial records. This is often referred to as Bookkeeping. When the business has a systematized and organized record keeping of business transactions, it will save you time worrying about whether your business is on the profit side or losing end. Also, you don’t need to worry on how to organize all the receipts you need to file and record.

2. BIR Tax Compliance and Other Reportorial Requirements. All income earners are required to pay monthly taxes, even small business owners. Yep, as a general rule, everything is taxable. As such, not having an accountant means you have to understand Taxation law of the Philippines in order to be tax compliant. Thus, this is another importance why you need an accountant. Seemingly, an accountant can compute and prepare BIR Tax Returns for you. It will save you time in studying tax law and computing your own tax return. Further, accountants can also give advice on effective tax management.

3. Save Time to Focus on Growth of Business. Keeping track of your financial data, recording and filing it can be time consuming, especially if you are not used to it. If you have an accountant, you can save a lot of time to focus on growing your business instead of worrying about tax deadlines and keeping an organized accounting records.

4. Save Money. When you don’t have an Accountant, there will be high possibility of future penalties, plus interest, on government reports you missed filing or incorrectly filed. Having an accountant can save you cost on these future penalties and charges of correcting your accounting books and tax returns on time.

5. Peace of Mind. The last but not least importance of an accountant in business is for owners to have peace of mind. When you have an accountant who does the record keeping and tax compliance, you don’t need to worry that if somebody comes to your business to do Audit. You are somehow confident that you have records to show you are complying with accounting and government reportorial requirements.

This is for those blog readers, CPA, accountant or otherwise who are searching my blog for a sample Statement of Management’s Responsibility.

“STATEMENT OF MANAGEMENT’S RESPONSIBILITY FOR ANNUAL INCOME TAX RETURN”

The Management of CORPORATION NAME, INC., is responsible for all information and representations contained in the Annual Income Tax Return for the year ended December 31, 2011. Management is likewise responsible for all information and representations contained in the financial statements accompanying the (Annual Income Tax Return or Annual Information Return) covering the same reporting period. Furthermore, the Management is responsible for all information and representations contained in all the other tax returns filed for the reporting period, including, but not limited, to the value added tax and/or percentage tax returns, withholding tax returns, documentary stamp tax returns, and any and all other tax returns.

In this regard, the Management affirms that the attached audited financial statements for the year ended December 31, 2011 and the accompanying Annual Income Tax Return are in accordance with the books and records of CORPORATION NAME, INC., complete and correct in all material respects. Management likewise affirms that:

(a) the Annual Income Tax Return has been prepared in accordance with the provisions of the National Internal Revenue Code, as amended, and pertinent tax regulations and other issuances of the Department of Finance and the Bureau of Internal Revenue;

(b) any disparity of figures in the submitted reports arising from the preparation of financial statements pursuant to financial accounting standards and the preparation of the income tax return pursuant to tax accounting rules has been reported as reconciling items and maintained in the company’s books and records in accordance with the requirements of Revenue Regulations No. 8-2007 and other relevant issuances;

(c) the CORPORATION NAME, INC., has filed all applicable tax returns, reports and statements required to be filed under Philippine tax laws for the reporting period, and all taxes and other impositions shown thereon to be due and payable have been paid for the reporting period, except those contested in good faith.

Corporate Code of the Philippines [Sec. 23-35]

TITLE III : BOARD OF DIRECTORS/TRUSTEES/OFFICERS

Sec. 23. The board of directors or trustees. – Unless otherwise provided in this Code, the corporate powers of all corporations formed under this Code shall be exercised, all business conducted and all property of such corporations controlled and held by the board of directors or trustees to be elected from among the holders of stocks, or where there is no stock, from among the members of the corporation, who shall hold office for one (1) year until their successors are elected and qualified.

Every director must own at least one (1) share of the capital stock of the corporation of which he is a director, which share shall stand in his name on the books of the corporation. Any director who ceases to be the owner of at least one (1) share of the capital stock of the corporation of which he is a director shall thereby cease to be a director. Trustees of non-stock corporations must be members thereof. a majority of the directors or trustees of all corporations organized under this Code must be residents of the Philippines.

A copy of alert from the Auditing and Assurance Standards Council (AASC) has been in my inbox a week ago and its only now that I find time to write for this blog about another topic. Anyhow, I am sharing you this alert for your information and reference. Find time to download and read this for it is so informative. The alert talks about the required information in compliance with RR 15-2010. It also talks about the disclosures required under the PFRS and RR-15 2010 and even the proper presentation of the financial statements. Furthermore, and take note, you can find in the appendix of the AASC alert an illustrative Audito’s reports like the one below and other examples.

We have audited the accompanying financial statements of [name of company], whichcomprise the statements of financial position as at December 31, 2010 and 2009, and thestatements of income, statements of comprehensive income, statements of changes inequity and statements of cash flows for the years then ended, and notes, comprising asummary of significant accounting policies and other explanatory information.

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements in accordance with PhilippineFinancial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud orerror.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial statements based on ouraudits. We conducted our audits in accordance with Philippine Standards on Auditing.Those standards require that we comply with ethical requirements and plan and performthe audit to obtain reasonable assurance about whether the financial statements are freefrom material misstatement.Page 6 of 14An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness ofthe entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all material respects, thefinancial position of [name of company] as at December 31, 2010 and 2009, and its financial performance and its cash flows for the years then ended in accordance with Philippine Financial Reporting Standards.

Our audit was conducted for the purpose of forming an opinion on the basic financialstatements taken as a whole. The supplementary information on taxes, duties and license fees in Note X to the financial statements is presented for purposes of filing with theBureau of Internal Revenue and is not a required part of the basic financial statements.Such information is the responsibility of management. The information has beensubjected to the auditing procedures applied in our audit of the basic financial statements.In our opinion, the information is fairly stated in all material respects in relation to thebasic financial statements taken as whole.